With the December 31, 2023 deadline nearing for self-funded employers to file their gag clause attestation under Section 201 of the Consolidated Appropriations Act (CAA), confusion abounds: Who’s responsible for what, and how can third-party administrators (TPAs) and brokers help their clients secure access to claims data?
Goodbill CEO and co-founder Patrick Haig sat down with Julie Selesnick, a Berger Montague attorney focused on healthcare and employee benefits, to discuss how TPAs and brokers can navigate a shifting regulatory landscape; fulfill obligations to both their clients and carrier networks; and unlock the power of claims data. Here are the main takeaways from a webinar they co-hosted on November 16. You can also see the full webinar transcript or view a recording of the webinar.
Section 201 of the CAA, known as the gag clause ban, is part of a bigger bipartisan regulatory push toward payment transparency and data access in healthcare. Related regulations in the past few years, including the 21st Century CURES Act, Hospital Price Transparency Rule, and Transparency in Coverage Rule, have put pressure on providers and payers to publish their prices and provide electronic access to patient health records.
Employers have had fiduciary obligations under the Employee Retirement Income Security Act of 1974 (ERISA) to manage their funds “prudently” and “solely in the interest” of plan participants and beneficiaries. But until the gag clause ban, Selesnick said, it was “virtually impossible” for employers to do that because they haven’t been able to review any of the underlying data.
Until the gag clause ban, it was virtually impossible for employers to fulfill their fiduciary duty to their plans because they lacked access to claims data.
Since going into effect, the law has emboldened employers to sue their plan administrators and insurers for restricting access to claims data, mismanagement of funds and inaccurate billing. Here are a few lawsuits that have made headlines:
The pressure for more transparency isn’t likely to go away any time soon, either. On the horizon: the Lower Costs, More Transparency Act, which would introduce penalties for service providers who don’t cooperate with removing gag clauses.
But the mounting pressure is creating tensions on multiple fronts, Selesnick said. For providers and carriers, whose contracts are “sacrosanct,” the gag clause ban paves the way for exposing more of their contract terms, which may “contain a lot of things plans probably won’t be happy to find out,” she said. “There is a real concerted effort to keep that access limited, as it has been, because it could undermine the existing business model for those groups,” she said.
TPAs and brokers are stuck in the middle, and must navigate a conflict of loyalty between a desire to help their plans, without losing access to carrier networks.
On the other hand, independent TPAs and brokers who act as intermediaries between plans and networks are stuck in the middle: They face a conflict of loyalty between their desire to help their plans and a fear of losing access to carrier networks. “Both of these groups are disincentivized from helping [clients get access to data], even though in many cases we see that they do wish to help,” she said.
A gag clause in the context of Section 201 is any contract term that restricts the plan from:
Plans must have access to any data included in claims or encounters, including:
Gag clauses are generally found in administrative service agreements between the plan and their TPAs or pharmacy benefit managers (PBMs). Common gag clause language includes words such as:
Other contract terms that can be interpreted as gag clauses are:
The gag clause attestation is the plan sponsor’s written statement that all gag clauses have been removed from their service agreements. This statement is due to the Department of Health and Human Services (HHS) by December 31, 2023.
Plan sponsors have three options, each of which carries some risk: File without full confidence; don’t file; or submit a “narrative” explanation instead.
Need help? Here’s a free attorney-drafted template you can use to help clients confirm their service providers have removed all gag clauses.
Removing gag clauses and getting access to the claims data is just the start, Selesnick says. “Now comes the hard part. Now you need help reviewing the data,” she said.
TPAs and brokers should help their clients hire a payment integrity vendor to audit those claims. Plans can start with a short historical lookback to see if anything’s amiss. If a historical claims review uncovers overpayments, the plan sponsor should hire a consultant or attorney for help in recovering those overpayments.
While a historical claims review is a good start, ideally plans should work towards being able to access and analyze claims on an ongoing basis, both Selesnick and Haig agreed.
Most plans overlook a huge chunk of savings because they only review claims above a certain threshold, Haig said. When Goodbill analyzed a plan that only reviewed claims above $35,000, a typical threshold, it found that it was neglecting 95% of claims, which amounted to 43% of total dollars billed.
“That’s kind of the insanity of it, because there are a lot of savings below that threshold,” he said.
Ongoing access to claims data ensures that no savings slip through the cracks, and that your plan pays out just once to the provider, and correctly.
Plans usually resort to selective reviews because they’re time- and labor-intensive, but Goodbill’s unique process starts early in the claims stream and provides a fast turnaround before payment, Haig explained. As soon as Goodbill receives a claim, it engages the member to digitally connect their electronic health record — with just a few clicks — enabling the claim to be thoroughly cross-checked against provider notes for coding errors and clinically unnecessary care.
As a result, Goodbill’s solution can save not only on large-dollar claims above $100,000, but also on the many smaller claims that add up and cost the plan and its members money, he said.
“It ensures you pay out once, correctly,” he said. Engaging members also keeps them “in the loop” on their billing situation, improving member satisfaction with their plans, he added.
Questions? Reach out to us at email@example.com.
Patrick Haig: [00:00:00] Before I move on to setting some context, the quick thing is Julie has been very generous in providing a template that she's provided to some of her clients and some of the parties that support those employer groups. That helps them push back on some attestations that may not fit the bill entirely.
Patrick Haig: And so she has been generous enough to give that to us. So anybody who's attending the webinar, you can get a link at the end of the webinar to go download that and use it to your own effect for your clients. So with that, let's set some context here. I think, we're almost to a decade of a large federal push towards transparency and access broadly as a healthcare theme, starting with here's our medical record data.
Patrick Haig: You have pricing on the hospital side, pricing on the payer side. And now with CAA section 201 around, the government putting their hand into the contractual relationship between all these parties and healthcare is a bipartisan effort. From our perspective, it seems like [00:01:00] this train's not stopping.
Patrick Haig: And so what this section 201 has really done is given employers who have a fiduciary duty to manage the funds on behalf of their members appropriately and prudently, it's given them a cause of action. So now all of a sudden they have a legal foot to stand on when it comes to confronting those that might get in their way in terms of fulfilling that duty and that's what we're going to be really talking about and specifically.
Patrick Haig: Or on the confusion around that because healthcare is what but a string of a bunch of contracts between the different parties. So we'll talk about what is gag clause, which contract does this apply to? Many of you may know that already, but what does the attestation really mean? Who is doing it on behalf of whom and what type of timeframe?
Patrick Haig: And then for those that might be helping an employer attest. How do you balance a lot of the dynamics that are in your business on behalf of your employer group and your clients to the best of your ability. So with that, I'm going to flip it to [00:02:00] Julie. Thank you, Julie.
Julie Selesnick: So we're going to start with basics, which is what is a gag clause? A gag clause in general is something that prevents you from talking about something. In the contracts that are relevant here, a gag clause is usually a clause that's found in a contract with a carrier TPA or a PBM, but it's really in any contract that the group health plan is entering into with a service provider that's providing access to a network of providers.
Julie Selesnick: So those contracts are the contracts subject to this rule. And in those contracts, a gag clause is any clause that directly or indirectly restricts the plan from sharing provider costs with plan associates. And that's participants, members, the plan sponsor, and also from sharing provider quality of care [00:03:00] information.
Julie Selesnick: But the most important part for today's conversation from electronically accessing de-identified claims data for each plan participant upon request. So that's where the issues come up, but we'll get back to that in a minute. So why are they banned? They're banned because whether you have an ERISA plan or not, but particularly under ERISA, the people that are administering the plan have a requirement to administer the plan prudently and only in the interest of participants and beneficiaries.
Julie Selesnick: So this is the law in ERISA-covered plans. But this is also true in many non-federal governmental health plans and public plans. They're using taxpayer funds, so they also have the same or similar requirements as the fiduciary obligations under ERISA. Up until very recently, it's been virtually impossible for employers who want to be good ERISA fiduciaries to their health plan to ensure that it's being [00:04:00] administered prudently and solely in the interest of plan participants, because they haven't been able to review any of the underlying data that you would need to review to make sure of that. And so a lot of you on the phone — I think there are brokers from what I saw from the poll — so you probably know in the 401k world this is already standard practice that you have access to all of this information and those fiduciaries are then held to a fiduciary standard, because they're supposed to use it. Section 201 is passed to help fiduciaries gain access to that, but it also brings with it a responsibility on plans to actually then do it and make good fiduciary decisions based on what they find.
Julie Selesnick: So what data needs to be accessible? Health plans have to have access to all the data that's involved in any claim or encounter transaction. That includes financial information, and they list examples in the statute, but it's not exhaustive. One of the examples in there, bill charges, is [00:05:00] an example.
Julie Selesnick: And something else that's in there that's very interesting is any other term in the provider contract. That's a financial term. So these are terms in the contracts between the provider and the network, the carrier that are going to affect what the final payment amount is.
Julie Selesnick: And that's a gap in the data that we actually are getting right now. Also have a right to provider information, name, clinical designations, things like that, service codes, and any other element in a claim or transaction for any specific claim. So it's really broad. So why is this such a tense issue and what, why is it so problematic and so hard to still get claims data, almost three years in?
Julie Selesnick: For providers and for carriers, those contracts between them are sacrosanct and, they're very difficult to get access to. I doubt many people have ever seen one because they're guarded extremely jealously. [00:06:00] And those contain the provisions of how claims will be paid that plans don't know and need to know and want to know.
Julie Selesnick: And they also probably contain a lot of things that plans won't be happy to find out. And when they do find out, they won't want to be subject to that. So there is a real sort of concerted effort to keep that access limited as it has been because it could undermine the existing business model for those groups.
Julie Selesnick: And then the other tension point is a lot of plans would go to their — if they have an independent TPA helping them process claims and acting as a middleman between the carrier TPA and their client or a broker acting as an intermediary. Both of those groups of people have some struggles of their own trying to assist plans and they have contracts. Also, so TPAs have a contract probably with the network carrier [00:07:00] whose network the plan is accessing, and that contract within TPA and the carrier will prohibit the TPA from sharing claims data with the plan, and at risk to them will be their entire access to the network.
Julie Selesnick: So that's the whole book of business. And for brokers, brokers will be threatened routinely with, losing their right to place certain carriers' business if they turn over information that the carrier doesn't want them to. So both of these groups that are the frontline service providers to plans are disincentivized from helping, even though in many cases we see that they do wish to help.
Julie Selesnick: And so we are going to provide some ideas on how that can happen, without jeopardizing your own business. Because this isn't going away. No matter how much we all, everyone wished it would go away at first. And I do think that the initial reaction was that a lot of people stuck their head in the sand and didn't do anything to begin with, but it's definitely not going away.
Julie Selesnick: We're about to file attestations for the first time. And in fact, [00:08:00] there's already been a concerted effort to see what's not going well in, in the current legislation and identify gaps in the law where it could be better and strengthen it and to just and then we have to figure out how we're going to make sure that we plug those holes so that this runs more smoothly.
Julie Selesnick: It isn't as burdensome for plans and helps them fulfill their obligations. So this is pending legislation, very cleverly titled the "Lower Cost, Even More Transparency Act," and it contains if it passes as written, it'll really make it easier for plans to get access to their data.
Patrick Haig: Julie, sorry, maybe interrupting quickly on that one. Can you give a sense of even one or two of the key provisions of that legislation that would really hit hard?
Julie Selesnick: Absolutely. So right now, one of the things plans struggle with is you have one option. You file an attestation, or we have two options. You file it, or you don't. There's no sort of way to telegraph to file on the website that's set up for attestations to say we [00:09:00] tried, but this carrier won't play ball. And so we can't get them out that there will be a sort of a provision in the new bill that allows for this sort of third option to point the regulatory agency at the party that is providing, that is obstructing this.
Julie Selesnick: And there's also a new penalty that would be placed on service providers that don't cooperate. So if you are the TPA that won't remove the gag clause, which is the carrier, or the PBM, all of a sudden if there is enforcement against you, there's a $10,000 a day penalty involved if you refuse to remove gag clauses as required by this law, because right now the reason there's no removal, there's no incentive for removal on the side of the people who put the gag clauses in, and that's making it very difficult for employers to comply with what they're supposed to do.
Julie Selesnick: How do you spot a gag clause? How are you supposed to know what a gag clause is?There's certain words that are, automatic buzzwords for this. As soon as you see "proprietary," [00:10:00] "audit," "confidential," that's a big hint that there's going to be a paragraph full of gag clauses. Here are some trickier ones. These are like, you might not really think off the bat are these gag clauses, but remember if it indirectly restricts you from claims data and all the claims data you want, it's also a gag clause.
Julie Selesnick: I don't think I've ever seen an administrative service agreement to this day that doesn't put a limit on the number of claims that can be audited and the number of audits that a plan can perform a year. Now, my position on this, taking a step back, is that ongoing claims review is not an audit and is not what is intended by the audit provisions.
Julie Selesnick: An audit is a 360-degree formal review of how the claims pricing TPA in general runs their business. You're looking at their computer security, at the banking setup, at all of that. You have to go on site, really. Old fashioned draconian requirements claim ongoing claims review is supposed to be allowed electronically.
Julie Selesnick: It's supposed to be something that plans are able to access, [00:11:00] that doesn't exist yet. But thus far, when the carriers that are TPAs do push back against request for claims data, the audit provision is the first one that gets trotted out. And they say, you can't do it. You got to follow the audit procedures.
Julie Selesnick: You can do it following the rules that you agreed to in the administrative service agreement. So while I don't agree that this should apply to request for claims data, this is how they are being applied by the people that hold the claims data. So these are gag clauses, but also many audit provisions.
Julie Selesnick: Do you have a question?
Patrick Haig: Yeah. Sorry. It's something like came up really quick. It should be a quick one: Is that a legal definition of an audit or is it a little more subjective and interpretive?
Julie Selesnick: It's more subjective. So ERISA certainly doesn't contain a definition of what an audit is, nor does any other law that I'm aware of that would be applicable to health plans the administrative service agreements, however they define what an audit is.
Julie Selesnick: And we often argue that what we're asking for is not [00:12:00] what an audit is, even in your own words. That said, it does not change the response. They still say it's an audit and they still say you have to follow the audit policies. However, at the end of the day, we are seeing movement, and it is possible to get data extracts now, routinely, in many cases, without having to go through the audit, procedures.
Julie Selesnick: But, when a company doesn't want to provide the data, they will use these provisions as the basis for the denial. And another, the ones that are really even more insidious are reserving the right to approve who is going to be the planned auditor. So now... You want your claims data, you're not doing an audit, you're doing a review, and you hire, a data integrity company, or the plan hires, someone who's going to do claim review, someone like Goodbill.
Julie Selesnick: The plan, now this, the right has been reserved to say no, we don't agree to that. And what happens is, there's two ways this happens. One, you'll be provided with a list of approved vendors. I suggest [00:13:00] that I would never want to use a list of approved vendors because you don't get on that list because you're really problematic to that person, to that carrier, you're on that list because you have a pretty good working relationship.
Julie Selesnick: It doesn't mean they're not going to do a good job, but you want somebody that isn't on an approved list by the person whose work you want to review. You want somebody who's completely independent. And they'll say things like, you can't hire somebody that works on a contingency fee, which is pretty funny in the first place, because when the carriers themselves do overpayment recovery, they do it on a contingency fee when they're looking for claims errors and recovery.
Julie Selesnick: But also, the rationale is that when you hire a company that's doing this on contingency, they're looking for problems because that's the only way they're going to make money. Say that's true, which I don't really think that is true. I think that a lot of people do things on contingency.
Julie Selesnick: A lot of companies [00:14:00] because a lot of smaller plans can't afford to just pay hourly rates for, a one time review or something. And you pretty much can guarantee that if you're going to do a big claims review that there are going to be problems that are going to be found. And there's nothing wrong with entering into a payment agreement that way.
Julie Selesnick: However, becoming the norm is ongoing review and ongoing review isn't going to be on a sort of contingency base fee basis or at least not solely there will be regular fees involved. So that sort of eliminates that restriction. And then the one, this one at the bottom, not allowing you to share results with the plan.
Julie Selesnick: That's absolutely absurd. It violates ERISA. That just can never ever be a legitimate cause, it should be void as a matter of law. But yet and still, it is still put in lots of administrative service agreements or in downstream confidentiality agreements, and I would just, I don't think that's a very good degree of provision to sign on to and agree to.
Julie Selesnick: So [00:15:00] now, we're moving on to talk about the attestation a little bit because everyone who knows what gag clauses are knows that the first attestation is required to be filed on or before December 31st of this year. And it actually covers the period going all the way back to December 27th, 2020 because it was a self-executing law.
Julie Selesnick: So the minute the CAA of 2021 was passed, this went into effect. And so it covers every contract that was that every relevant contract that was entered into for the first time. Or renewed. Since that time. And when you're making this attestation, you're not even only talking about your 2023-2024 contracts.
Julie Selesnick: You really are talking backwards. So I think objectively speaking, there probably should be zero attestations that could be filed truthfully on the 31st that go all the way back. That being said, I think that the general thought is, do your contracts now have the gag clauses removed? And that's what most people are going by.[00:16:00]
Julie Selesnick: So you can look on the DOL website or CMS, Department of Labor, Center for Medicaid and Medicare Services, or even on the IRS website and find these FAQs, they're Frequently Asked Questions, and this is FAQ 57, and all three — the DOL, Health and Human Services, and Treasury — put them out together.
Julie Selesnick: And in those facts, they tell you how to file the attestation and other rules surrounding it, and they give you the website they've created, which is on that second line, and they also give you an Excel template Put in the information. It's really easy. It's probably like a 10-minute project overall.
Julie Selesnick: The problem is you see when you look at it, but the only option you have if you use the website is to say I am attesting that I removed the gag clauses from these contracts and then you sign. Now you can let your TPA do this for you or your PBM or even another service provider But the FAQs do make it [00:17:00] clear that no matter who signs it, it's on behalf of the plan.
Julie Selesnick: The risk stays with the plan. It's considered the plan's disclosure. And this is definitely one of the easier sort of administrative things to do, that it's not hard. It doesn't, I could barely log onto this webinar, and I could do this. It's not hard administratively.
Julie Selesnick: But so letting someone else do it for you isn't going to remove any risk. You want to make sure that you agree with it before you file it.
Patrick Haig: And if you submit online, do you still have the ability? You said you only have the ability to really say yes, I attest or no, I don't. Can you submit something in the middle or is it?
Julie Selesnick: Not really. So how might you go about submitting something that's a bit different? You are jumping ahead of my slides. So a little later we're going to talk about, there's you have three options here and I'll just give you the three options now and then when [00:18:00] we get there I'll talk about them.
Julie Selesnick: You can file this attestation on the website. You cannot file an attestation and do nothing or you can submit. Something in lieu of attestation directly to either your local EBSA office or directly to the agencies, the Department of Labor or whichever one is governing your plan, if it's not a ERISA plan, then to HHS.
Julie Selesnick: So we'll talk about that more afterwards, but those are your three alternatives. There's no way to use that website, however, to submit anything except for, yes, I attested.
Julie Selesnick: Oh, here are the [00:19:00] three options, right? I'm just going to put them all on the screen and now I can talk.
Julie Selesnick: So I'm going to file the attestation. I'm tired. I don't know what else to do. I'm sick of hearing about it. This is my 90th webinar. I'm doing it. What are the pros for that? The pros, you're Probably not going to be on any sort of enforcement radar if you do this, especially this year. The cons, it's very difficult to know if what you're filing is truthful.
Julie Selesnick: In many cases, many plans probably know it's not truthful, but even if you think you got the gag clauses out, it might be difficult to know whether or not this truthful or not. And I suppose this risk does run across the board, even though it's here. It could be cited in a lawsuit against you later.
Julie Selesnick: It like, hey, I asked my say a participant finds out that something was all exorbitantly overpriced and their cost share was part of this. They had to pay a portion of it And the plan's response to that is well, it's not really up to us. We don't even see that data We just are part of the [00:20:00] network or something they could say did you file an attestation, and they could come up pre-litigation definitely during litigation And if you did then why haven't you looked at the data and seen that these prices are so out of whack. Why haven't you done something about it?
Julie Selesnick: And so this is the larger point and that we'll get to this soon is that it's not, that we're all caught up on the attestation requirement and getting these out of the contracts but it's because that's just opening the door, then you have to walk through the door and actually get the data and use it and that's the important part. So your second option here back to this is so you don't attest what happens there, but you make sure you didn't submit a false statement to the government.
Julie Selesnick: So that's a positive, a pro. A con is that, if there is some way that the DOL has a list of self-funded plans, which they don't, and then a list of these. Submitted attestations, they could compare them and see who didn't file. But the bigger risk is that it is to me as like a secondary violation.
Julie Selesnick: So say the [00:21:00] Department of Labor begins looking at a plan for some reason, then they're going to check and look at compliance things. They're going to ask you to submit a copy of the confirmation that you submitted, the attestation or something like that, and once. One thing's not in compliance, then you're going to get the full treatment the whole business and everything that you're supposed to be doing will be looked at, and there'll be a more in depth compliance review than probably many plans would like to have.
Julie Selesnick: And then the third option is submit a narrative in lieu of attestation instead, or even call, an EBSA office, although people have called and the response has been that EBSA doesn't really know what to do either and they direct people back to the website. So that so far at least hasn't been a great idea that the submitting a narrative in lieu of attesting is something that's in the pending legislation.
Julie Selesnick: So it would be relying on proposed legislation that hasn't come into effect yet, which is listed as the [00:22:00] con. Again, the pro of this is you're not submitting a false statement, but also you're not doing nothing. And so it doesn't, in that middle group just doing nothing, you're just not in compliance at all.
Julie Selesnick: And you're not showing any indication that you even knew you were supposed to do this, nevermind that you put thought into it. Whereas if there's a narrative where you say, look, I tried, but we couldn't do it because of blah, blah, blah. Then at least the agency, if someone's looking at it and thinking about it, realizes that you put thought into it, you're trying to be a proper fiduciary and this is what you're doing.
Julie Selesnick: And another danger with both the submitting a narrative is it's probably not a good idea if you do that to not make a big change in your plan over the next 12 months because you can probably only do that once if you're doing it the next time. Why would you be in the same situation again? Part of being a good fiduciary is correcting, these problems in your plan and making it better.
Julie Selesnick: So probably it's a one time deal to do something like that.
Patrick Haig: And that part was probably most surprising to me when you taught me, that is [00:23:00] the fact that you get one shot at the narrative, and then if you come around the next planning year and you haven't switched carriers or TPA or ASA provider, whatever it might be it's a real bad luck.
Patrick Haig: And you will not be smiled upon by the enforcement powers that be.
Julie Selesnick: That's right. And does that mean that you'll necessarily be in a heap of trouble? No, but it just it increases the exposure to the plan in a way that, you don't need to do. All right. So I think we have a poll up here.
Patrick Haig: We do.
Julie Selesnick: Yeah, I'll be very interested.
Patrick Haig: For those who haven't seen it or can't read it, is your client planning to file a gag clause attestation by December 31st? Yes, no, not sure. And the second question, have you seen your client's gag clause attestation? So probably most applicable to the brokers and TPAs in the party.
Patrick Haig: Let's see the results. Okay. [00:24:00]
Julie Selesnick: I'm impressed at the 35 percent on both. 35 percent of people on the phone are either employers or know that their client is filing one and has seen it. So that's a lot higher than previous percentages, even though it doesn't seem as high. I think that compliance is becoming more and more.
Julie Selesnick: Yeah. The norm. So let's now talk about the risks and responsibilities and how you can fulfill your fiduciary duties while still protecting your business. If you're a TPA or a broker So you don't have fiduciary duties most of the time as a TPA or broker, but you have duties to your clients.
Julie Selesnick: And so the question is, how can you help them? How can you help your plan clients without putting your own business at risk? And, how do you be on the right side of the CAA?
Julie Selesnick: Okay. So if you're an employer, So we're going to start with advice to an employer and none of this is should be taken as legal advice. Let me just start there. You should always talk about this with your own plan counsel and make any decisions in conjunction with your own counsel. I am just telling you sort of general principles that under ERISA that would be the way to do this properly and under benefits law in general. Always seek your own advice before making a decision.
Julie Selesnick: So as an employer, what do you want to do here? The goal is to get access to historical claims So once you have access to your claims data, you know You want to review claims have them reviewed for discrepancies and then you use the findings of that Unfortunately, the findings are very likely going to show lots of claims handling issues and that can be the basis for better ongoing access in the future so that there aren't all these mistakes that need to be remedied after the fact.
Julie Selesnick: That maybe the plan can be more of a partner in the administration of claims on an ongoing basis and the plans vendors can assist in [00:26:00] finding the mistakes before they happen and or finding the overpayments before they happen and prevent them from happening in the first instance because it's much easier not to pay something than to recover something that's already been paid.
Julie Selesnick: Okay. Another thing that employers should be watching out for is what we've seen happen is that employers will work really hard and to negotiate out gag clauses only to find later when it's time to sign a confidentiality agreement in exchange for the data that now the confidentiality agreement is full of gag clauses.
Julie Selesnick: Guess what? That agreement isn't subject to the gag clause rule. So what we do, at least what I advise my client clients is to try and negotiate the confidentiality agreement that will be required for access to data at the same time as you're negotiating your new administrative service agreement and even have it as an exhibit A or exhibit B or something to the administrative service agreement because once it's incorporated into the agreement, then the gag clause rule will apply to it and you can't get a nasty surprise down the road.[00:27:00]
Julie Selesnick: And yeah. So that is obviously the best practices and the best thing you can try and do, but not every carrier will agree to that. But a lot are agreeing to it. So definitely worth a shot. And then what should you do if the historical claims review does show a lot of overpayments? One, you have to recover them and this is where the language of the administrative service agreement becomes very important, too because you want to see do I have a right to do I have to go and you know get the carrier to recover this from each provider individually.
Julie Selesnick: Am I prevented from contacting providers myself? The best case scenario is that there's provisions in the agreement that's giving you access to the network that says If the overpayments are the fault of the person that repriced the claim at the network price, then they're responsible for putting in the overpayment because then you, you just say to the carrier the carrier, TPA, as the plan you.
Julie Selesnick: Oh, our plan this much money. You [00:28:00] can recover it however you want. Doesn't matter to us. We just want this back or we want some offset for next year's prices, but we also want, that's where you open the door to accessing, more favorable claims terms for the next year and possible pricing, but definitely better terms that allow you more earlier interference.
Julie Selesnick: So you're not in that boat again. If you're a broker, what should you do and watch out for? The best thing you can do as a broker is educate your clients about the CAA, and which is, gag clauses, compensation disclosures prescription drug and data collection and reporting, and mental health parity comparative analysis of the non quantitative treatment limitation.
Julie Selesnick: And then also educating them about the transparency and coverage requirements and having sort of searchable tools and provider networks and things like that available. So that's the best thing you can do because you are the very first person that the plan fiduciaries look to for guidance. Most health plan fiduciaries aren't in the business of healthcare.
Julie Selesnick: They have no idea what they're supposed to be doing, and they're certainly not in the world of healthcare [00:29:00] administration. And so it's very complicated. The rules were already very complex and now this has added new layers of complexity and all kinds of new obligations. And it's very overwhelming for plans.
Julie Selesnick: So to the extent you can make this easier for your client, by giving them education on sort of their requirements and reminding them of critical dates and making suggestions to them about ways they can be in compliance. That's just the most helpful thing you can do. And a way to do that is to help them assemble sort of compliance teams, dream teams that will help them make sure they're doing what they're supposed to do.
Julie Selesnick: When they're supposed to do it, and that might include legal counsel, especially it definitely includes a payment, someone to do payment integrity review. And once that's done, a decision has to be made, and it could be made beforehand, but definitely after do we need legal counsel, because you need to make sure that, you protect the plan's assets and your plan fiduciaries as is, because they're on the hook for this too. And [00:30:00] they have to make the right decisions. They want to have an obligation to. Only administer the plan wisely to make sure that the plan is being administered in accordance with plan terms and with underlying contracts.
Julie Selesnick: Three, recover overpayments that are made. And so they have to do all of these things and they can't do it without a team of professionals to help them do it. Starting, and I think starting claims analysis, legal other point solution vendors. Sometimes that, some people Don't even want to be bothered with finding gag clauses because it's hard.
Julie Selesnick: And so there are now solutions out there to help you find your gag clauses. Sometimes there are really cool things like this that you can help put together for your planned clients to help them, make compliance easier. If you're an independent TPA, what should you do and watch out for?
Julie Selesnick: You guys are in a really tough position and I, I do understand that. I think that the biggest, hardest thing for independent TPAs right now is that they provide their clients with access to a network. And that is [00:31:00] pursuant to a contract that independent TPA has with them. And that contract almost always will require the TPA to keep confidential and proprietary data, which the network will say is your claims data to keep it from the plan. And so the TPA is in a position where they feel that they're risking their entire access to this network by, helping plans get access to their claims state. However, you don't have to be in the middle of the process to be helpful.
Julie Selesnick: You can still be helpful to your plan clients. Without you, independent TPA, being the person turning over the claims data. You can draft letters for them that they can send to the carrier. They probably in most cases. your clients also signed an agreement with the network. And so they can directly ask the network for their claims data.
Julie Selesnick: And you can help them do that. And you can help them with the language and the sort of [00:32:00] CAA language and the backup for why they want the data without actually having to be on the front line of that. So you don't have to be the middle person to be helpful to the client here. You can still really bring a lot of value and help them do what they need to do.
Julie Selesnick: And this is a time where there's a real dissatisfaction out there with people with plans with their TPAs. I'm not trying to be mean. I'm sorry to anyone on the phone. I'm sure you're all wonderful because, and it's a self selecting group. If you're here, it means you probably do want to be in compliance and help your plans comply.
Julie Selesnick: And it's hard. And so the more you differentiate yourself by being helpful and still manage to, find a way to not be helpful directly in the middle of it, then probably the more stable your ongoing network access is and the more ability you're going to have to attract new plan clients who want TPAs that'll assist them in getting their data and getting gag clauses out.
Julie Selesnick: I think another poll. All right. So this one is, have your [00:33:00] clients asked you for help with this. And I guess this could, the second question is for anyone is, do you have legal counsel on your team or on the plans team who can help with these types of questions?
Julie Selesnick: Give a few more seconds. All right. They show. Yeah.
Julie Selesnick: Yeah. It does look like there have been a lot of requests for assistance with that. And I think I'm not surprised by the number, the low percentage that do have legal assistance. It's hard, small plans, small mid sized plans aren't looking to add expense, and legal assistance can be an expense.
Julie Selesnick: But there are [00:34:00] certainly ways to get legal assistance with. Specific discreet issues without it having to break the bank. And now there's all kinds of sort of things coming out that can help plans be better fiduciaries prior without having to take the drastic step of hiring a lawyer. And if you need one, you should get one.
Julie Selesnick: And, there's lots of situations where lawyers will work on a contingency fee, particularly if the goal is to recover overpayments from past historical claims data analysis. So there are ways to fund things that don't break the bank, but there are also now all kinds of really innovative products coming out and fiduciary assistance that you can implement into the plan that stops short of needing a lawyer.
Julie Selesnick: But, when the time comes, sometimes you gotta do what you gotta do. Oh, here we go.
Julie Selesnick: I think this is it, your client, so you did it, you got the gag [00:35:00] clauses out, you filed the attestation, then you did the confidentiality grant, you got the data, your client has the data, oh, it's a very... But that's not it, now comes the hard part, so I hate to say that, but now comes the big job, everything about the attestation and getting the gag clause out of the contract, it was all for this, the question is what do you do next, now you need help reviewing the data.
Julie Selesnick: Step one, hire a payment integrity vendor to review the claims for errors. And then if so maybe you start with a 30 days of claims data or something smaller, three months, something like that. Then whatever you find, that's the basis for sort of a more historical review or not. Maybe you'll be thrilled.
Julie Selesnick: Maybe your findings will be that, we had one category of improper payments, but otherwise we're satisfied. Then you can feel good. You did what you're supposed to do. The plan did what it's supposed to do. You do this periodically and keep monitoring, but you don't need any big changes. More frequently, what we [00:36:00] see is there's a lot of questions and especially the question of why was this claim priced this way when that is not the negotiated discount that's reflected, you know in the data. So that requires going back and negotiating and discussing and usually leads to a larger claims review historical claims review And that is definitely probably where you want to hire a lawyer to help you navigate like what you think the plan is capable of getting back whether or not how to do it, most administrative service agreements with the network between the client and network have a sort of a self help provision in them, a dispute resolution mechanism that keeps you out of court, but lets you let the network, carrier.
Julie Selesnick: No. Hey, I don't agree with what you're giving. Here is the stated reason and we're going to invoke this clause of the contract. So let's try and resolve it informally over the next 30 days. But if we can't, then I think we're going to go to mediation or [00:37:00] arbitration or whatever this says, because I don't think you're complying with the contract and you're saying you are.
Julie Selesnick: So that's the next step then, that's one step. There can be litigation. There can be agreement. You can, sometimes the the carrier network will accept your findings and refund the plan or do things like that. So there can be lots of different outcomes, but none of them can happen until you get the data and hire a payment integrity vendor to start reviewing it.
Julie Selesnick: With that, I will turn it over to Patrick, who I think will tell you exactly what Goodbill can do with your claims data.
Patrick Haig: All right. Yeah. Thank you, Julie. Sure. There we go. So I think this audience, you guys know the power of claims data. I'm going to explain our perspective on it. Which is we're building towards the ideal flow.
Patrick Haig: Think of it as, not having to always just get a historical claims feed and then review it post payment, but rather how do we do this at scale inflow? So [00:38:00] I'll walk through that. The truth is most claims never really get a deep review, but they could. And so this is I think, emblematic of most plans.
Patrick Haig: Most plans have a review threshold above which claims will, pen the claim, do a deeper dive on it. That review threshold, we've heard various amounts. It can be as low as $10,000. It can be as high as $125,000. I think the standard might be something like $25,000. Using a real TPA, 95 percent of their facility claim volume falls below their review threshold, and makes up 43 percent of their billed costs.
Patrick Haig: And that today is getting no look whatsoever. And that's the insanity of it. Because there is a lot of savings below that threshold, and from our perspective can only be really known in flow with the medical record claims access is not only about clawing back [00:39:00] on overpayment and making sure that you paid out correctly historically, but it really, I think the future of everything is.
Patrick Haig: And we believe this at Goodbill it ensures you pay out once correctly, it's about payment efficiency, administrative efficiency, and making sure that everybody's taken care of at the point of processing and adjudication. So the future that we are building at Goodbill is: provider issues the claim, we empower the member to get involved in the process transparently, which solves a couple of problems.
Patrick Haig: Number one, they know what's going on. So this is now all of a sudden a bit more transparent to them and they feel a little less out of the loop because let's not forget most members have first-dollar responsibility and it doesn't hit the plan yet until that member fulfills that deductible. It also enables the plan to get access to the medical record via the member to power the deepest review possible because the medical record is the origin of that claim.
Patrick Haig: And from there, it's about reviewing, editing accordingly, and then paying out. And if we can do that correctly, that means that the plan pays out once, correctly, and we move on. There's no need for [00:40:00] all of this. And that empowerment leads to savings and accuracies across the spectrum from the lowest end to the high end.
Patrick Haig: On the left hand side, you have a real claim that would fall below most plans thresholds. This is an ER claim where with the medical record, you can identify. One of the biggest charges wasn't actually necessary at all, according to the documentation and thus the biggest charge on the the ER evaluation management charge was upcoded, because it really should have been lower because that CT scan should have happened. And that's 50 percent savings on that given claim all the way to the higher end that perhaps you all are more familiar with, which is you have an inpatient claim. It's above that review threshold. But with the medical record, having done this prepayment review lends itself to the plan pays out correctly the first time without needing to have to worry about historical analysis and overpayment.
Patrick Haig: This is where this is all going right? Yeah, the gag clause ban, the [00:41:00] gag clause attestation, it's really, as Julie's highlighted, meant to give employers a legal foot to stand on when it comes to fulfilling their fiduciary duty to get claims data, which is only the beginning of the journey.
Patrick Haig: And I think what we're building towards is a scalable process where we can just trust these things at the point of adjudication and move on. And with that we'll go into some Q&A, there are some questions in the Q&A if you have been holding back for whatever reason, you just don't want to type that thing out, like unleash now.
Patrick Haig: But let's take the first question, which is: If the vendor that a TPA or a plan uses a random sample of claims for review or audit, does this lessen the network risk that the network will, or the carrier will pull that access?
Julie Selesnick: It lessens the risk of, for that, but it doesn't [00:42:00] satisfy the plan's needs to review all of the claims and do a comprehensive review. Now, maybe once things are running smoothly, then you can go to random sampling, but I don't think any plan is in a condition right now where that would be an optimal solution from the plan side.
Julie Selesnick: It does lessen the risk, however, from the carrier network side.
Patrick Haig: My take on this one is that what we have seen in terms of the magnitude of error rates on claims, random sampling is a quality control and like often manufacturing where it makes sense because typically error rates are fairly low, we're seeing error rates, oftentimes majority of claims across certain bands of gross charges random sampling is just going to miss a lot of the overpayment or incorrect payment on the bulk of claims. So I think Julie, to your point I think I, I agree with that. If for a plan to really fulfill that duty, you really need to understand where you are on a per claim basis [00:43:00] moving forward.
Julie Selesnick: That's right. And especially if your claims are being auto adjudicated right now, which most of them are, no one's looking at them.
Julie Selesnick: They've never been looked at yet, and so really they do need to be looked at and reviewed and actually reviewed on a line item basis, like what Patrick just showed, there's no way that low dollar bills are being reviewed currently against medical records or anything like that. I don't think any plan is in a state right now where you could accept a random sampling and think that would really show you all the problems that you need to fix.
Patrick Haig: And then I think we have a question from Justin Leader, I think we know Justin I've heard that burying your head in the sand is always a great strategy on attestation.
Julie Selesnick: So Justin and I have been, around the country with this spiel since the gag clause legislation has passed. And that is often what we see in the [00:44:00] eye that there has been a general bury ahead of the strands stats. But I have to disagree, Justin. It's definitely not a good strategy. And I think Justin knows that too. It's a terrible strategy and not going to work anymore. And that is what has been the first couple of years.
Julie Selesnick: What we saw was a general I am not paying attention to this. And if I ignore it, nothing will happen. But unless you're really close to retirement, I think that you should pay attention to it because it's going to happen.
Patrick Haig: And then another question from Justin in certain parts of the U. S. there may be limited options for networks and administrators. Is there recourse? Should a covered service provider hold a plan sponsor hostage, essentially stating if you don't like our contract, go somewhere else?
Julie Selesnick: So this is the nightmare that plans in certain parts of the country face is the reality and this is also what the governmental agencies that are issuing these regulations don't understand. They'll tell you like, you should just end the contract and find a new vendor and people I hear this all the time. And that's great advice if you can but there are areas of the country [00:45:00] where it's more difficult.
Julie Selesnick: However, the world is changing and what's getting exciting also is the ability to try and look for ways to cobble together a plan that doesn't use a network and that you can do direct contracting and maybe rental access to other people's networks. You could do medical expense reimbursement. Plans as front facing plan documents with a network beside it just in case, but there are all kinds of new ways and plan design alternatives that, producers should really be considering as ways to try and, especially if you're being held hostage, try and really think outside the box of ways to get out of this.
Julie Selesnick: Because if someone does have you hostage, they're never going to give you your claims data. They're never going to give you back the overpayments. If you do find them, you're just never going to be on a level playing field. So the key is just to keep looking for ways to level the playing field in ways that haven't been tried yet.
Julie Selesnick: Because the sort of the carriers that are hold the access, everything that's been tried, they've got an answer for it's time [00:46:00] to try new things. And that's where the sort of the non network world is becoming a much bigger factor.
Patrick Haig: Next question is: does this apply to all types of planning a risk of covered claims, including non medical?
Julie Selesnick: It's not stupid at all. It applies. Only it to health plans, though this regulation and it would apply, though, to all claims under health plans. So prescription drug, medical devices, things like that. That said also other Arisa plans have very similar rules where you would be entitled to information like
Patrick Haig: We have a question here. What is Goodbill's low threshold? Did you say $10K? No, we actually have no threshold. So we'll look at any claim and that's just the nature of philosophically where we think the world's headed as well as just being a software company. We were able to do that with the member in the flow. It's just the case I said $10K and that most very progressive [00:47:00] plans I've heard have a $10,000 review threshold. But realistically, most plans are on the order of about $25K review threshold. And yeah.
Patrick Haig: Then we have another couple questions. Do standard claim reviews look for a spread between what was paid to provider and what was built to the plan?
Julie Selesnick: I love that question. So you answer that because you do the claims review and then I'll want to chime in.
Patrick Haig: Yeah. From a price perspective, Thank you. Yes. We often focus mostly on coding and clinical. And we have pricing in some flavors of our reviews. And then I do know, broadly speaking vendors out there do look at what is negotiated and what is allowed.
Patrick Haig: And, looking at that spread there, we're fortunate that we have access to the hospital price transparency data, which does have negotiated rates on a per pair basis. I can use that accordingly. And for everything I've heard, there's a lot [00:48:00] of cruft there.
Julie Selesnick: And so this question is a great question and it leads to what is going on when you end up with data that's, the negotiated rate so you know what you think it should be even once you put all the things together and then you see what was allowed and they don't match and you have to figure out in a lawsuit that has been filed on behalf of two labor unions in Connecticut against Anthem. This is one of the questions is why don't these numbers match? Is there a spread that's going into the pocket of the carrier that's giving you this access? Or is it because there are other provisions in these provider agreements that are then affecting?
Julie Selesnick: They're adding money back on top of the negotiated rate or not applying the negotiated rate because there's some sort of value based agreement or a bonus agreement or some sort of offsetting agreement that you did all these things that the plan has no idea about that could make the price that's paid be different.
Julie Selesnick: [00:49:00] So I think that's a great question. Someone should be looking for that because that is a easy sort of category to look for things. But overall, this needs to be looked at really closely. This is where we need to drill down on the legal and consulting and data access side.
Julie Selesnick: Once we see these discrepancies, we have to go back and say, explain this discrepancy, either provide the provisions in that provider agreement. Caused you to price this claim like this, instead of like this, you have to pry that, or you have to provide some other explanation for why it's like that.
Patrick Haig: Yeah. I think when we were chatting about revenue neutrality, is that one of the more common things you tend to see contractually?
Julie Selesnick: I think that so I certainly don't even know the universe of crazy payment provisions inside of the agreements between the providers and the the carriers, but there are things like, revenue neutrality, where there are [00:50:00] guaranteed fees to just pay a hospital a certain amount every year.
Julie Selesnick: And so there are things where bonuses are added on where they will, and these should also aren't claim costs, by the way, not all of these things and shouldn't be categorized as claim costs. There are fees in many cases. Another is if there was a improper payment earlier, it might be added on to a current payment.
Julie Selesnick: So the first question is in any of these. These sort of network, these agreements with the providers is this applies across the board to the fully insured plans and self funded plans. But are they applying these payment provisions across the board? I don't know. And is it more likely that you're gonna put, extra money onto a claim in your fully insured line that you pay for or in the self funded line where it's not your money and it's not your skin in the game?
Julie Selesnick: Because we don't know the provisions that are affecting the payment amounts, we don't even know the questions to ask yet, but those are the [00:51:00] questions that will flow from that is are you distributing this evenly? Or is the self, is your self funded book footing the bill for all of this stuff?
Julie Selesnick: Which, seems plausible. We just don't know because we don't have the data for it. But I think there's going once this starts to become more commonplace. And once there are some court rulings on this, I think reviewing the data is step one and then figuring out why is it okay to charge more for this?
Julie Selesnick: Is it being done in a fair way? And are these all prohibited transactions at this point? If the, especially if the network carrier is a fiduciary, which they will be found to be a fiduciary in some cases. Then in those cases how is this not a prohibited transaction if they're applying sort of provisions that benefit them to your claim?
Julie Selesnick: So there's it's a lot of issues there.
Patrick Haig: Great question. Next one. Okay somewhat similarly, once the and we'll do two more questions. So this is one, and then we'll do one more. Once the gag clause I think is complete, I think maybe that the [00:52:00] attestation is complete. Does this require groups to request all claims for a certain duration of time?
Julie Selesnick: There is no requirement written into CAA 201. That's now part of ERISA and part of all the other governing laws. However, as if you're an ERISA governed plan, or if you have fiduciary obligations and you're not an ERISA covered plan, then. It was already an obligation and this is the tool to allow you to do it You really do need to request the claims data now do you're not in violation of any law if you haven't done it yet And no plan should be advised that they have to do this or they're you know going to automatically be in penalty but this is really the risk for all of this the bigger risk is really private litigation and That will come and there will be class action lawsuits once this data starts becoming more available and not The worst place to be once this becomes more commonplace is in the low hanging fruit camp of plans that never even bothered to get the data because those are going to be the [00:53:00] ripest targets for class action litigation once the data, once it becomes clear that there are actionable items.
Patrick Haig: And the last question yeah, if you have a take on this I'll take a stab at this one. How can you be sure that a member won't be billed for claims that have been denied due to the TPA needing more medical documentation, et cetera. If the TPA doesn't work with the provider to get that information, or if the provider doesn't respond many times, the member doesn't know and they pay out of pocket.
Patrick Haig: And if not resolved, it doesn't apply to their deductible or out of pocket max on larger client claims just gets overlooked. From our perspective, number one, this is why we want to be in flow and we actually handle all the appeals on our denials that we may are on our any of our claim edits number two.
Patrick Haig: And this is a big deal. Having a member relationship matters, which means that they know the company that has done. This is on their side. And if they have that they get balance billed or if they get whatever it might be, they could turn around and just tell us or upload it to their account.
Patrick Haig: And then we can attack it from that perspective. [00:54:00] We think that is hugely important because from a review and cost containment perspective, everything we've heard is that historically with more traditional models of cost containment. The tighter you screw down on cost containment, the worse the member experience gets, which you need to fix that because we have to contain costs.
Patrick Haig: Otherwise the member, again, is taking a lot of the brunt of that.
Julie Selesnick: And I would just say that I think this is another huge problem for ERISA fiduciaries that if they're not. Thinking about questions like that and then that is a great thing to put on your list of what should I be thinking about as a fiduciary?
Julie Selesnick: Is this a report that I can request so I can know that when a claim is denied the member is refunded their portion of the share and things like that? I think that's a great question.
Patrick Haig: All right. Two things last. We're right at time. Number one, go to Goodbill.com/gag to download that template that I mentioned at the outset.
Patrick Haig: Again, this template is a way for you to help [00:55:00] your groups push back on any, let's call it murky attestations or where they feel like they're not exactly on solid ground and they don't have full confidence that's a really good attestation pushes the onus back on the party. That's a supplying the attestation on behalf of the group to really understand like, hey, like you're good on this one, right? Like we're gonna, we're gonna act on this. So you're saying you're good on this. Which I believe Julie has used to good effect and you can download for free again at Goodbill.com/gag. And with that, we're already answered those. Thank you for attending.
Patrick Haig: This is our contact information. If you want to get in touch, let us know. And yeah, thanks again for attending. Thank you.
Julie Selesnick: Thanks, Julie. Thanks for having me. That was fun. Yeah,
Patrick Haig: That was fun.